Calyx and Corolla - Case Study

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Weakness

A significant downside for Calyx and Corolla is their dependence on their supplier and its primary delivery service. Under any circumstances, if Federal Express has a problem with the delivery system, customers will not be able to receive their products on time. The late delivery of flowers will result in disappointed customers and the probability of the customers purchasing from Calyx and Corolla will drop significantly. Secondly, the suppliers for Calyx and Corolla are only located in California, Florida and Hawaii. Although the chances are unlikely, but if the weather in these places worsen, the production will significantly drop and Calyx and Corolla will have no immediate substitute. Thirdly, Calyx and Corolla has no option for delivery on Sunday. Although many companies do not offer shipment on weekends, Calyx has the opportunity to gain a competitive advantage over other mail order firms. Lastly, suppliers of Calyx and Corolla are not large in size and hence they may not be able to meet the increasing demand of product in the future.

Opportunities

Calyx and Corolla are yet still considered to be a small player in the market but they have a lot of potential to grow and capture a larger market share. Few of the many opportunities Calyx and Corolla have are expansion and growth in international market. According to the case, "Per capita consumption of flowers and plants in the United States was $36 annually, whereas in Holland it was $60" (Salmon & Wylie, 1995, p. 4). International expansion can increase the awareness of the brand and also further expand the company. Secondly, major events and holidays have increased the sales figure drastically in the past and Calyx and Corolla can use this opportunity to market their products during specific period to achieve maximum sales. Thirdly, Calyx and Corolla can increase brand awareness by marketing the company and its products through different means of communication such as media, radio, posters and word of mouth. Calyx and Corolla currently contributes approximately 2.8% of total revenue to market their products. Although, Calyx and Corolla have positioned themselves to specific consumers, I believe they can expand further by positioning their products to other business and also continuing to market consumers. Calyx and Corolla can sell products to businesses that use flowers as part of their services because it plays an important symbol in many events. Business such as wedding planners, funeral homes, party planners and others are a good example of businesses that Calyx and Corolla can market to. Lastly, Calyx and Corolla can expand their business by increasing the number of corporate clients and promotional tie ins. Recently, Calyx and Corolla have started to promote their products through corporate tie-ins. There have already been opportunities for Calyx and Corolla to expand their product with promotional tie-ins with Voluntary Hospitals of America (VHA), but Lee, vice president of marketing, not yet committed Calyx and Corolla to these programs (Salmon & Wylie, 1995, p. 9).

Threats

Although there are many opportunities for the company which can help them grow, there are also threats that can place Calyx and Corolla out of business. Competition is always a big factor and is considered to be a dangerous threat. The mail order business already owns less than 20% of the market share, and supermarkets and local retailers have the potential to capture even a larger market share. Secondly, the weather can affect the sales of the company as flowers can only grow in certain weather conditions. Therefore seasonality is a uncountable threat that can affect the sales of Calyx and Corolla. Lastly, the large network of FDT can affect the mail order business. FDT has more than 25000 retail florist and has a larger capital than Calyx and Corolla, hence they can advertise at a larger scale and attract more customers.

Problem & Solution:

Calyx and Corolla have grew gradually over the years and have now reached at a point where they cannot expand any further at a high rate with its current business strategy and market positioning. Calyx and Corolla must reassess and implement a new long-term growth strategy. The company has set high standards for itself and provides its customers with fresh products. Calyx and Corolla's networks with suppliers and Federal Express provides a competitive advantage over its competitors. This relationship between supplies, Federal Express and the customers required many years of hard work and dedication. The company has dedicated almost a decade in developing a mail order company, and this has been their strength ever since. I believe Calyx and Corolla must stick with mail order and not directly compete with traditional outlets, such as retail florists and Florists Telegraph Delivery (FTD). Another reason for not competing against traditional outlets is because Calyx and Corolla do not have sufficient capital to advertise products and outperform the services provided by traditional outlets and lastly, the company lacks expertise in this sector. To expand the growth of the company, Calyx and Corolla can expand its market position, increase brand awareness through different means of advertisements, start to expand globally, and continue to and increase the number of promotional tie ins. To increase the growth rate and achieve higher sales level, Calyx and Corolla can expand its market position and start selling products to another market segment. As I talked about it earlier, Calyx and Corolla could start conduction business to business operations, where Calyx and Corolla can sell flowers to businesses that use these products on a daily basis such as wedding planners, funeral homes, and event or party planners. Secondly, Calyx and Corolla need to market their products through broader means of communication. One of their biggest means of advertising were the catalogues offered by the company. Calyx and Corolla need to develop other strategies to market individuals who have never heard of Calyx and Corolla. Some strategies they can follow are television advertisements, promotions on radio broadcasts, outdoor marketing strategy such as posters, and lastly word of mouth. Thirdly, Calyx and Corolla can build a professional network with suppliers in other countries and provide products in countries where the flower market if significantly large. According to the case, Holland per capita consumption of flowers were $60, which approximated the average in Europe (Salmon & Wylie, 1995, p. 4). Lastly, Calyx and Corolla should take the opportunity of corporate programs because it is a large source of income, and helps with